The proposed research will utilize secondary data from several sources to conduct a pooled time series analysis of the conditions related to hospitals entry into multihospital systems. The study's primary objectives are to go beyond existing performance research on multihospital systems by examining selection related issues affecting this literature. These would include: 1. An assessment of the market and management conditions that precipitate hospital entry into multihospital systems. 2. An evaluation of whether or not such conditions differ systematically within the hospital population. 3. An analyses of the market and management conditions associated with hospital entry into different types of systems (e.g. nonprofit, investor owned) and different affiliation statues (ownership, leasing, contract management). The theoretical framework integrates elements of economic and open systems organization theory to specify how hospitals behave vis-a-vis multihospital systems entry and the market and management factors affecting such entry. In order to refine the theoretical framework and complement the secondary data analysis, a series of on-site interviews with system administrators will be conducted. These interviews will focus on system acquisition strategies and changes in these strategies under DRG-based reimbursement. The second analysis will combine data from the 1970-83 American Hospital Association Annual Survey, the Area Resource File, the American Hospital Association Validation Survey of Multihospital Systems and other published sources. The analysis will focus on 553 hospitals that entered systems under ownership, leasing or contract management arrangement since 1975. A randomly selected comparison group of approximately 1500 freestanding hospitals will also be included in the analysis.